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Exhibit 10.27
2000 DUN & BRADSTREET CORPORATION REPLACEMENT PLAN
FOR CERTAIN DIRECTORS HOLDING DUN & BRADSTREET CORPORATION
EQUITY-BASED AWARDS
1. PURPOSE OF THE PLAN
The purpose of the 2000 Dun & Bradstreet Corporation Replacement Plan for
Certain Directors Holding Dun & Bradstreet Corporation Equity-Based Awards (the
"Plan") is to provide for the award of substantially identical replacement
stock options, replacement phantom stock units and/or replacement deferred
performance share units to New D&B Directors, Former Directors and Moody's
Directors. It is the intention of the Company that the terms of the replacement
awards will (i) together with awards adjusted by D&B, substantially preserve
the value of the adjusted D&B awards and (ii) except for the terms described
elsewhere in this Plan, remain substantially identical to the terms of the
adjusted D&B awards.
2. DEFINITIONS
The following capitalized terms used in the Plan have the respective
meanings set forth in this Section:
(a) Act: The Securities Exchange Act of 1934, as amended, or any successor
thereto.
(b) Awards: Replacement options, replacement phantom stock units and
replacement deferred performance share units granted pursuant to the Plan.
(c) Beneficial Owner: As defined in rule 13d-3 under the Act (or any
successor rule thereto).
(d) Board: The Board of Directors of the Company.
(e) Change in Control: The occurrence of any of the following events:
(i) any "Person" as such term is used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
(other than the Company, any trustee or other fiduciary holding securities
under an employee benefit plan of the Company, or any corporation owned,
directly or indirectly, by the shareholders of the Company in substantially
the same proportions as their ownership of stock of the Company), is or
becomes the "Beneficial Owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company representing 20%
or more of the combined voting power of the Company's then outstanding
securities;
(ii) during any period of twenty-four months (not including any period
prior to the execution of this Agreement), individuals who at the beginning
of such period constitute the Board, and any new Director (other than (1) a
Director designated by a person who has entered into an agreement with the
Company to effect a transaction described in clause (i),
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(iii) or (iv) of this Section, (2) a Director designated by any Person
(including the Company) who publicly announces an intention to take or
to consider taking actions (including, but not limited to, an actual
or threatened proxy contest) which if consummated would constitute a
Change in Control or (3) a Director designated by any Person who is
the Beneficial Owner, directly or indirectly, of securities of the
Company representing 10% or more of the combined voting power of the
Company's securities) whose election by the Board or nomination for
election by the Company's shareholders was approved by a vote of at
least two-thirds (2/3) of the Directors then still in office who
either were Directors at the beginning of the period or whose election
or nomination for election was previously so approved cease for any
reason to constitute at least a majority thereof;
(iii) the shareholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than
(1) a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity) more than
50% of the combined voting power of the voting securities of the
Company or such surviving entity outstanding immediately after such
merger or consolidation and (2) after which no Person holds 20% or
more of the combined voting power of the then outstanding securities
of the Company or such surviving entity; or
(iv) the shareholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition
by the Company of all or substantially all of the Company's assets.
(f) Code: The Internal Revenue Code of 1986, as amended, or any successor
thereto.
(g) Committee: The Compensation and Benefits Committee of the Board, or
any successor thereto or other committee designated by the Board to assume the
obligations of the Committee hereunder.
(h) Company: The New D&B Corporation, a Delaware corporation to be renamed
"The Dun & Bradstreet Corporation" after the Spinoff.
(i) D&B: The Dun & Bradstreet Corporation, a Delaware corporation to be
renamed the "Moody's Corporation" after the Spinoff.
(j) D&B Deferred Performance Share Unites: A bookkeeping entry, equivalent
in value to the number of deferred performance shares of D&B stock credited to
a Director's account as of the opening of business on the Spinoff Date,
pursuant to the D&B Plans.
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(k) D&B Phantom Stock Units: A bookkeeping entry, equivalent in value to
the number of phantom shares of D&B stock credited to a New D&B Director's
account or a Former Director's account, as of the opening of business on the
Spinoff Date, pursuant to the D&B Plans.
(l) D&B Plans: The 1998 Dun & Bradstreet Corporation Non-Employee
Directors' Stock Incentive Plan and the 1998 Dun & Bradstreet Corporation
Replacement Plan for Certain Nonemployee Directors Holding Dun & Bradstreet
Corporation Equity-Based Awards.
(m) D&B Stock Option: Stock Option held by a Director that was granted
under the D&B Plans.
(n) Deferred Performance Share Unit: A bookkeeping entry, equivalent in
value to one Share, credited in accordance with Section 10(a) of the Plan.
(o) Determination Day: As such term is defined in Section 9(b) of the
Plan.
(p) Directors: A new D&B Director, Former Director and a Moody's Director.
(q) Disability: Inability of a New D&B Director to continue to serve as a
director of the Board or the inability of a Moody's Director to serve as a
director of the Moody's Board due to a medically determinable physical or mental
impairment which constitutes a permanent and total disability, as determined by
the Board (excluding any member thereof whose own Disability is at issue in a
given case) with respect to a New D&B Director or as determined by Moody's Board
(excluding any member thereof whose own Disability is at issue in a given case)
with respect to a Moody's Director based upon such evidence as it deems
necessary and appropriate. A New D&B Director or a Moody's Director shall not be
considered disabled unless he or she furnished such medical or other evidence of
the existence of the Disability as the Board or Moody's Board, as the case may
be, in its sole discretion, may require.
(r) Effective Date: The Spinoff Date.
(s) Fair Market Value: On a given date, the average of the high and low
prices of the Shares as reported on such date on the Composite Tape of the
principal national securities exchange on which such Shares are listed or
admitted to trading, or, if no Composite Tape exists for such national
securities exchange on such date, then on the principal national securities
exchange on which such Shares are listed or admitted to trading, or, if the
Shares are not listed or admitted on a national securities exchange, the average
of the per Share closing bid price and per Share closing asked price on such
date as quoted on the National association of Securities Dealers Automated
Quotation System (or such market in which such prices are regularly quoted), or,
if there is no market on which the Shares are regularly quoted, the Fair Market
Value shall be the value established by the Board in good faith. If no sale of
Shares shall have been reported on such Composite Tape or such national
securities Exchange on such date or quoted on the National Association of
Securities Dealers Automated Quotation System on such date,
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then the immediately preceding date on which sales of the Shares have been so
reported or quoted shall be used.
(t) Former Directors: Certain former directors of D&B whose Awards under
the D&B Plans were adjusted pursuant to the Spinoff.
(u) Moody's Board: The Board of Directors of D&B.
(v) Moody's Change in Control: The occurrence of any of the following
events:
(i) any "Person," as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), (other than D&B, any trustee or other fiduciary
holding securities under an employee benefit plan of D&B, or any
corporation owned, directly or indirectly, by the shareholders of D&B
in substantially the same proportions as their ownership of stock of
D&B), is or becomes the "Beneficial Owner" (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of securities of D&B
representing 20% or more of the combined voting power of D&B's then
outstanding securities;
(ii) during any period of twenty-four months (not including
any period prior to the Spinoff Date), individuals who at the
beginning of such period constitute the Moody's Board, and any new
Director (other than (1) a Director designated by a person who has
entered into an agreement with D&B to effect a transaction described
in clause (i), (iii) or (iv) of this Section, (2) a Director
designated by any Person (including D&B) who publicly announces an
intention to take or to consider taking actions (including, but not
limited to, an actual or threatened proxy contest) which if
consummated would constitute a Change in Control or (3) a Director
designated by any Person who is the Beneficial Owner, directly or
indirectly, of securities of D&B representing 10% or more of the
combined voting power of D&B's securities) whose election by the
Moody's Board or nomination for election by D&B's shareholders was
approved by a vote of at least two-thirds (2/3) of the Directors then
still in office who either were Directors at the beginning of the
period or whose election or nomination for election was previously so
approved cease for any reason to constitute at least a majority
thereof;
(iii) the shareholders of D&B approve a merger or consolidation
of D&B with any other corporation, other than (1) a merger or
consolidation which would result in the voting securities of D&B
outstanding immediately prior thereto continuing to represent (either
by remaining outstanding or by being converted into voting securities
of the surviving entity) more than 50% of the combined voting power of
the voting securities of D&B or such surviving entity outstanding
immediately after such merger or consolidation and (2) after which no
Person holds 20% or more of the combined voting power of the then
outstanding securities of D&B or such surviving entity; or
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(iv) the shareholders of D&B approve a plan of complete
liquidation of D&B or an agreement for the sale or disposition by D&B
of all or substantially all of D&B's assets.
(w) Moody's Directors: certain directors of D&B whose awards under the
D&B Plans were adjusted pursuant to the Spinoff.
(x) Moody's Phantom Stock Unit: A bookkeeping entry, equivalent in value
to one share of common stock of D&B, credited in accordance with Section 9(a) of
the Plan.
(y) New D&B Deferred Performance Share Units: A bookkeeping entry
equivalent in value to one Share, credited in accordance with Section 10 of the
Plan.
(z) New D&B Dividended Deferred Performance Share Units: A bookkeeping
entry, equivalent in value to the number of phantom performance shares credited
to a Director's account as a dividend on such Director's D&B Deferred
Performance Share Units pursuant to the Spinoff.
(aa) New D&B Dividended Phantom Stock Units: A bookkeeping entry,
equivalent in value to the number of phantom Shares credited to a New D&B
Director's account or a Former Director's account as a dividend on such
Director's D&B Phantom Stock Units pursuant to the Spinoff.
(bb) New D&B Directors: certain directors of the Company whose awards were
adjusted under the D&B Plans pursuant to the Spinoff.
(cc) New D&B Phantom Stock Unit: A bookkeeping entry, equivalent in value
to one Share, credited in accordance with Section 9(a) of the Plan.
(dd) Option: A stock option granted pursuant to Section 7 of the Plan.
(ee) Payment Day: As such term is defined in Section 8(b) of the Plan.
(ff) Person: As such term is used in Section 13(d) or 14(d) of the
Act (or any successor section thereto).
(gg) Phantom Stock Units: New D&B Phantom Stock Units and Moody's Phantom
Stock Units.
(hh) Plan: The 2000 Dun & Bradstreet Corporation Replacement Plan for
Certain Directors Holding Dun & Bradstreet Corporation Equity-Based Awards.
(ii) Retirement: Termination of service with the Company after such New
D&B Director has attained age 70 or termination of service with D&B after such
Moody's Director has attained age 70, regardless of the length of such
Director's service.
(jj) Shares: Shares of common stock, par value $.01 per share, of the
Company.
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(kk) Spinoff: The distribution of the Shares to the public
shareholders of D&B.
(ll) Spinoff Date: The date on which the Shares are first distributed
to the public shareholders.
(mm) Subsidiary: A subsidiary corporation, as defined in
Section 424(f) of the Code (or any successor section thereto).
(nn) Termination of Service: With respect to a New D&B Director,
termination of service with the Company and with respect to a Moody's
Director termination of service with D&B.
(oo) Termination Date: As such term is defined in Section 8(b) of the
Plan.
3. SHARES SUBJECT TO THE PLAN
The total number of Shares which may be issued under the Plan is
equal to the aggregate number of shares to be issued as replacement awards, as
calculated pursuant to Sections 7 and 9 of this Plan. The shares may consist,
in whole or in part, of unissued shares or treasury shares. After the initial
grant of awards, no further awards shall be granted under the Plan.
4. ADMINISTRATION
The Plan shall be administered by the Board, which may delegate its
duties and powers in whole or in part to any subcommittee thereof. The Board is
authorized to interpret the Plan, to establish, amend and rescind any rules and
regulations relating to the Plan, and to make any other determinations that it
deems necessary or desirable for the administration of the Plan. The Board may
correct any defect or supply any omission or reconcile any inconsistency in the
Plan in the manner and to the extent the Board deems necessary or desirable. Any
decision of the Board in the interpretation and administration of the Plan, as
described herein, shall lie within its sole and absolute discretion and shall be
final, conclusive and binding on all parties concerned (including, but not
limited to, the Directors and their beneficiaries or successors).
5. ELIGIBILITY
Only Directors may receive grants of replacement stock options,
replacement phantom stock units and replacement deferred performance share
units under the Plan.
6. LIMITATIONS
Options hereunder shall only be granted in replacement of D&B Stock
Options (as defined in Section 7(a) of the Plan) held by Directors immediately
prior to the Spinoff Date.
7. TERMS AND CONDITIONS OF OPTIONS
Options granted under the Plan shall be nonqualified stock options
for federal income tax purposes, as evidenced by the related Option agreements,
and shall be subject to the foregoing and the following terms and conditions
and to such other terms and conditions, not
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inconsistent therewith, as the Board shall determine;
(a) Generally. As of the Spinoff, each unexercised D&B Stock Option
held by a Director shall be adjusted and such Director shall receive a
replacement stock option pursuant to this Plan. The number of Shares
covered by each replacement stock option shall be determined by multiplying
(i) the number of shares of D&B common stock covered by the adjusted D&B
Stock Option by (ii) fifty percent and rounding down the result to a whole
number of shares. The option price of each replacement stock option shall
be determined by multiplying (i) the trading price of the Company as of the
last trade "when issued" immediately prior to the Spinoff by a fraction,
the numerator of which is the option price of the adjusted D&B Stock
Option, and the denominator of which equals the trading price of D&B as of
last trade "regular way" immediately prior to the Spinoff. Unless otherwise
specified in this Plan, all other terms of the replacement stock options
shall remain substantially identical to those of the adjusted D&B Stock
Options as set forth in the D&B Plans and related option agreement(s).
(b) Exercisability. Except as set forth in the Plan, stock options
granted under the Plan shall have substantially identical terms as those of
the stock options originally granted under the D&B Plans; provided,
however, that in no event shall a replacement stock option be exercisable
more than ten years after the date the original option was granted under
the D&B Plans.
(c) Expiration. An Option shall expire on the tenth anniversary of
the date on which the original option was granted under the D&B Plans.
(d) Exercise of Options. Except as otherwise provided in the Plan or
in a related Option agreement, an Option may be exercised for all, or from
time to time any part, of the Shares for which it is then exercisable. The
purchase price for the Shares as to which an option is exercised shall be
paid to the Company in full at the time of exercise at the election of the
Participant (i) in cash or its equivalent (e.g., a check), (ii) in Shares
having a Fair Market Value equal to the aggregate option price for the
Shares being purchased and satisfying such other requirements as may be
imposed by the Board, (iii) partly in cash and partly in such Shares or
(iv) through the delivery of irrevocable instructions to a broker to
deliver promptly to the Company an amount equal to the aggregate Option
Price for the Shares being purchased. No Director shall have any rights to
dividends or other rights of a shareholder with respect to Shares subject
to an Option until the Director has given written notice of exercise of the
Option, paid in full for such Shares and, if applicable, has satisfied any
other conditions imposed by the Board pursuant to the Plan.
(e) Termination of Service. Upon a Termination of Service by reason
of death, Disability, Retirement or by the Company or D&B, as the case may
be, or by the Director for any reason, the unexercised portion of the
Option may thereafter be exercised pursuant to the terms of the D&B Plan
under which the original option was granted.
(f) Nontransferability of Stock Options. Except as otherwise provided
in this Section 7(f), a stock option shall not be transferable by the
Director otherwise than by
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will or by the laws of descent and distribution and during the lifetime of
a Director an option shall be exercisable only by the Director. An option
exercisable after the death of a Director or a transferee pursuant to the
following sentence may be exercised by the legatees, personal
representatives or distributees of the Director or such transferee. The
Board may, in its discretion, authorize all or a portion of the options
previously granted or to be granted to a Director to be on terms which
permit irrevocable transfer for no consideration by such Director to any
child, stepchild, grandchild, parent, stepparent, grandparent, spouse,
sibling, mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law, or sister-in-law, including adoptive relationships, of the
Director, trusts for the exclusive benefit of these persons, and any other
entity owned solely by these persons ("Eligible Transferees"), provided
that (x) the stock option agreement pursuant to which such options are
granted must be approved by the Board, and must expressly provide for
transferability in a manner consistent with this Section and (y) subsequent
transfers of transferred options shall be prohibited except those in
accordance with the first sentence of this Section 7(f). The Board may, in
its discretion, amend the definition of Eligible Transferees to conform to
the coverage rules of Form S-8 under the Securities Act of 1933 or any
comparable Form from time to time in effect. Following transfer, any such
options shall continue to be subject to the same terms and conditions as
were applicable immediately prior to transfer. The events of Termination of
Service of Section 7(e) hereof shall continue to be applied with respect to
the Director, following which the options shall be exercisable by the
transferee only to the extent, and for the periods specified, in Section
7(e). The Board may delegate to a committee consisting of employees of the
Company the authority to authorize transfers, establish terms and
conditions upon which transfers may be made and establish classes of
options eligible to transfer options, as well as to make other
determinations with respect to option transfers.
8. TERMS AND CONDITIONS OF PHANTOM STOCK UNITS
(a) Phantom Stock Units. As of the Spinoff Date, D&B Phantom Stock
Units and New D&B Dividended Phantom Stock Units then held by each New D&B
Director and Former Director shall be forfeited, and such Director shall
receive replacement New D&B Phantom Stock Units and Moody's Phantom Stock
Units pursuant to this Plan. The number of Shares credited as New D&B
Phantom Stock Units shall equal the number of forfeited New D&B Dividended
Phantom Stock Units and the number of shares of common stock of D&B
credited as Moody's Phantom Stock Units shall equal the number of forfeited
D&B Phantom Stock Units. The New D&B Phantom Stock Units and Moody's
Phantom Stock Units shall be credited with dividend equivalents when
dividends are deemed paid on balances held by employees of the Company (the
"Employee Balances") in the Dun & Bradstreet Common Stock Fund of the
Company's Profit Participation Plan (or successor plan)(the "Employee
Plan"), and dividend equivalents with respect to Shares shall be converted
into additional New D&B Phantom Stock Units (including fractional New D&B
Phantom Stock Units) and dividend equivalents with respect to shares of
common stock of D&B shall be converted into additional Moody's Phantom
Stock Units (including fractional Moody's Phantom Stock Units). In the
event that the Moody's Common Stock Fund under the Employee Plan is
terminated, the Moody's Phantom Stock Units will be equitably converted
into New D&B Phantom Stock Units based on the relative Fair Market Values
of the Shares and the common stock of D&B at the time of the conversion.
Unless otherwise specified in
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this Plan, all other terms of the replacement New D&B Phantom Stock Units
and Moody's Phantom Stock Units shall remain substantially identical to
those of the forfeited D&B Phantom Stock Units as set forth in the
applicable D&B Plans and related agreement(s).
(b) Payment in Cash Upon Termination of Service. On the tenth day
(the "Payment Day") of the calendar year immediately following the calendar
year containing the date of a Director's Termination of Service (the
"Termination Date"), the Director shall receive a lump sum payment in cash
equal to the Fair Market Value of the number of Phantom Stock Units
(including fractional Phantom Stock Units) credited to the Director's
Phantom Stock Unit account on the December 31 immediately preceding the
Payment Day (the "Determination Day"). Between the Termination Date and the
Determination Day the Director's Phantom Stock Units shall continue to be
credited with dividend equivalents and such dividend equivalents shall
continue to be converted into additional Phantom Stock Units (including
fractional Phantom Stock Units) in the manner set forth above. As an
alternative to receiving such payment on the Payment Day, the Director may
elect to receive his or her payment in such forms of payments (and on such
terms and conditions) as are established by the Committee in its sole
discretion.
(c) Crediting of Stock Dividends. When non-cash dividends are paid on
Shares or shares of common stock of D&B, a Director's Phantom Stock Units
shall be credited with dividend equivalents by crediting the Director's
account in a manner consistent with the treatment of the Employee Balances.
9. TERMS AND CONDITIONS OF DEFERRED PERFORMANCE SHARE UNITS
As of the Spinoff Date, New D&B Dividended Deferred Performance Share
Units then held by each Director shall be forfeited, and such Director shall
receive replacement New D&B Deferred Performance Share Units pursuant to this
Plan. The number of Shares credited as New D&B Deferred Performance Share Units
shall equal the number of forfeited New D&B Dividended Deferred Performance
Share Units. New D&B Deferred Performance Share Units shall be credited with
dividend equivalents when dividends are deemed paid on balances held by
employees of the Company (the "Employee Balances") in the Dun & Bradstreet
Common Stock Fund of the Employee Plan, and such dividend equivalents shall be
converted into additional New D&B Deferred Performance Share Units (including
fractional New D&B Deferred Performance Share Units) in a manner consistent with
the treatment of the Employee Balances. Unless otherwise specified in this Plan,
all other terms of the replacement New D&B Deferred Performance Share Units
shall remain substantially identical to those of the D&B Deferred Performance
Share Units from which they arose as set forth in the applicable D&B Plans and
related agreement(s).
10. ADJUSTMENTS UPON CERTAIN EVENTS
Notwithstanding any other provisions in the Plan to the contrary, the
following provisions shall apply to all Awards granted under the Plan:
(a) Generally. In the event of any change in the outstanding Shares
after the Effective Date by reason of any Share dividend or split,
reorganization, recapitalization,
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merger, consolidation, spin-off, combination or exchange of Shares or other
corporate exchange, or any distribution to shareholders of Shares other
than regular cash dividends, the Committee, in its sole discretion, and
without liability to any person, may make such substitution or adjustment,
if any, as it deems to be equitable, as to (A) the number or kind of shares
or other securities issued or reserved for issuance pursuant to the Plan or
pursuant to outstanding Awards, (B) the option price and/or (C) any other
affected terms of such Awards.
(b) Change in Control. Upon the occurrence of a Change in Control, (A)
all Phantom Stock Units shall become payable to Directors in cash and (B)
all Options shall vest and become exercisable.
(c) Moody's Change in Control. Upon the occurrence of a Moody's Change
in Control, (A) all Phantom Stock Units shall become payable to Moody's
Directors in cash and (B) all Options held by Moody's Directors shall vest
and become exercisable.
11. SUCCESSORS AND ASSIGNS
The Plan shall be binding on all successors and assigns of the Company
and a Director, including without limitation, the estate of such Director and
the executor, administrator or trustee of such estate, or any receiver or
trustee in bankruptcy or representative of the Director's creditors.
12. AMENDMENTS OR TERMINATION
The Board may amend, alter or discontinue the Plan, but no amendment,
alteration or discontinuation shall be made which would diminish the rights of
any Director under any Award theretofore granted without such Director's
consent.
13. NONTRANSFERABILITY OF AWARDS
Except as provided in Section 7(f) of the Plan, an Award shall not be
transferable or assignable by the Director otherwise than by will or by the laws
of descent and distribution. During the lifetime of a Director an Award shall be
exercisable only by such Director. An Award exercisable after the death of a
Director may be exercised by the legatees, personal representatives or
distributees of the Director. Notwithstanding anything to the contrary herein,
the Board, in its sole discretion, shall have the authority to waive this
Section 13 (or any part thereof) to the extent that this Section 13 (or any part
thereof) is not required under the rules promulgated under any law, rule or
regulation applicable to the Company.
14. CHOICE OF LAW
The Plan shall be governed by and construed in accordance with the
laws of the State of New York applicable to contracts made and to be performed
in the State of New York.
15. EFFECTIVENESS OF THE PLAN
The Plan shall be effective as of the Spinoff Date.
